Help to buy ISA closure and reinstatement

citylights

I closed my help to buy isa as I was in the process of purchasing a property. The next day, the purchase fell through.

My bank (Lloyds) says that I can reinstate the account, but I need a purchase failure notice from my solicitor to do so.

The problem is that my solicitor will not sign the purchase failure notification document, as she says it appears to only cover the scenario where you solicitor had already put in the bonus application (which obviously hadnt happened yet with my purchase as my account was only closed the day before the purchase failed). However she also says that she was not sure and had not seen this before and encouraged me to speak to the bank to find out what I need (which I did and noone seemed to know).

So my question is, has anyone had this happen before? Can you still use the purchase notification failure form in my scenario, or did your solicitor just draft a letter which got accepted?

Obviously pretty keen to not lose the bonus entitlement if I don't purchase another property in a set period of time.

eskbanker

I'd suggest advising your solicitor to read clause 8.8 of the conveyancer guidance:

https://www.helptobuyisaadmin.org.uk/sites/default/files/conveyancer-guidelines-january-2021.pdf

kaMelo

Who told you to do that?

There is a set process in using a help to buy ISA,  your solicitor needed to be the one who applied for the funds once the purchase was under way,  that is the only way you would received the bonus or be able to reinstate the account with a failed purchase.

What did you do with the money?  By closing the account it also loses it's ISA status unless you transferred it to another ISA.

The fact you closed it off your own back I don't see any way to reinstate the account,  indeef if the money lost its ISA status it will definitely not be allowed.

eskbanker

kaMelo said:

Who told you to do that?

There is a set process in using a help to buy ISA,  your solicitor needed to be the one who applied for the funds once the purchase was under way,  that is the only way you would received the bonus or be able to reinstate the account with a failed purchase.

What did you do with the money?  By closing the account it also loses it's ISA status unless you transferred it to another ISA.

The fact you closed it off your own back I don't see any way to reinstate the account,  indeef if the money lost its ISA status it will definitely not be allowed.

The HTB ISA holder is responsible for closing the account, and the conveyancer claims the bonus, see clause 7.1(i) of that document (and elsewhere):

The Help to Buy: ISA Holder will close their Help to Buy: ISA and obtain Closing Documents from their Eligible ISA Manager before instructing the Conveyancer to start the Bonus Request process.

citylights

Thanks for your help all.
I'll send that link on (exactly what I was looking for) and see what response I get.
And yes, I completely agree that I shouldn't be running around trying to find out what documents they need to supply. The circumstance of the purchase failure was pretty awful and I could do without also having to do my solicitors leg work, but for now I just want it all sorted ASAP.